Is it possible to get financing for a home 'off the grid'?

I have a new REO listing located 3 miles down a rough dirt road, then 2.5 miles down a very steep, windy, horrific driveway.

The house is in fair condition, it needs appliances and carpet at minimum. It was already a pretty horrible house, until I noticed the generator and zillion batteries.

Once I got back to civilization (no cell service here) I called PG&E and found out that I had not seen a backup generator - but a primary power source.. ugh.

Is it possible to get financing on a house without paved road, power or phone service (and no feasible way to get those three), on a well with a septic?

Besides hard money of course.

FHA 203 K. But I don't know if it would be worth it. Even after repairs, it doesn't found like a great seller.

Alternative Energy used to mean Alternative Financing; but I've sold many "Alternative Energy" or Off the Grid houses in the past few years houses where their primary source of electricity has neen Solar Photovoltaics or a Wind Mill Generator with Heat and Hot water has been by Solar or Wood, and the water supply is by gravity; water hammer; or a collection system of cisterns.

I had a little "Niche" for the New Age People, or Survivalists who often thrive on this style of living off renewable energy as much as possible; while still having the bulk of the conveniences. Lot's of 2nd homes that have been prepared as a "Place to Run Away To."

Conventional Loans (with a 20% D.P.) have typically been available, with the understanding that the Bank or Credit Union (including the IBM Employees Credit Union) would be keeping the loan in their own portfoilo and would not be trying to sell it to the secondary market. A bigger obstacle has been the lack of a "Town Maintained Road". The lenders have been quite cautious about making sure that in the event of Foreclosure, they can at least get prospective Buyers to the location for an Auction. Good Town Maintained Gravel Roads are often superior to Paved Roads which are busted up by frost and destroyed every few years here.

You New REO probably wasn't billed as an Alternative Energy Dwelling; but a place for a Minimalist Hermit. I'm surprised that you saw a generator still on the premisies. They have a way of being among the first items to walk off.

P.S. Auburn, it would be interesting to hear how there came to be a Mortgage on your REO in the 1st place. Was it a Land Loan with 35% or 40% Down which then got built on. What kind of financing had been provided by Who and When ? I wouldn't be surprised if it was an Internet Home Equity Loan originated about 3 years ago with No Appraisal. And is that financing entity still in business ? Somehow, it doesn't seem like a thorough job of underwriting was done on that Loan ! Otherwise, no one should be surprised.

Jeff, are you a lender?

From past experience FHA wont lend on properties without heat and air, I would imagine electricity and year round access would be required as well..

It looks like they had a hard money loan of $80,000 to buy it and refinanced into a conventional in 2001 and then in 2004 for a total loan amount of $245,000. It was Freemont, who I believe has gone under.

The bank does not believe me about access issues and lack of power, because they have an 'appraisal' that says it is on all city services.. which would be interesting to see, since power is a good 5 miles away and sewer is about 20 miles away..

If it is permissible in your Jurisdiction, that Appraiser (IF there was one) should be a good Candidate for being "Drawn and Quartered"!

Please let us know IF you ever become privy to the Contents of the "Appraisal".

This is a good week to make such a "Discovery" !

From my experience FHA 203K is a nightmare. 3 bids on everything. RD, if it's available in your area, much better bet. You can escrow up to 20K for repairs or improvments and as long as you work with a lender that knows the program, it's pretty seamless.

I don't think costs for running electricity vary all that much within the U.S. and my experience is that 5 miles of Electric Line would be roughly $158,000 (before the cost of obtaining any Easements), so I doubt any 203K or RD is going to be very helpful. And Electricity was just one of the issues.

What is your nightmare with FHA 203k? I could agree that working with an experienced team of consultant and lender can make a very big difference. I just finished project file number 267 and my experience is most of the issues are from the uneducated masses of buyers, lenders and real estate agents.

As for RD they are inspecting per HUD/FHA MPS and their RD office does the inspections, yeah, all the RD office. While any inspector can pick a new house apart. I find them to be in both offices in my area to be worse than the Community Housing Department.

Thank you, it was like people were missing that entirely.

Yeah, PG&E actually quoted $232,000 with the homeowner responsible for getting easements!!!

This is an old mining area and this is the only house within about 800 acres on the parcel map, so unfortunately there is no one out there to share the cost, and people don't move out here to have city conveniences, you know?

Scary freaking area.. 'Hills Have Eyes' territory.

It would probably be an amazing area to use a metal detector at though, as there are tons of remnants of old mining camps from the late 1800s.

Six Dollars a running foot is about the best I can get here; but some of our Utility Companies charge as much as $13.00 a foot. Some have enormous crews available; but they often sit idle. Some are Unionized and won't do anything extra to help cover their costs. Other small Utilities can bid to do initial line stringing projects in the Franchised Territory of another Utility (Not a Unionized one of course) provided that they conform to a Standard Code. It's 50¢ extra per foot to run the Telephone Line at the same time. A valuable option !

Many times Buyers will come here and purchase a piece of dirt for $25,000 or $30,000 and then discover that the costs to bring some of the conveniences they are accustomed to will be far in excess of the cost of the Land itself. So much for the Toughguy TimberJack Image when his Wife needs to plug in her HotRollers. So much whining !

You could always ask your seller if they would finance it.

Or just tell them its un financible and chop the price to cash value.